EU VAT for e-commerce 2026: OSS, IOSS and online seller obligations

Updated: 25 May 2026 — Reviewed by a chartered accountant (expert-comptable), Hayot Expertise (Paris).

Since 1 July 2021, the VAT rules applying to B2C online sales into the European Union have been fundamentally overhauled. In 2026, these rules are fully operational and tax administrations across the EU are actively stepping up enforcement. Whether you ship goods from France to EU consumers, import small parcels from outside the EU, or sell through a marketplace, you are affected.

Direct answer: once your B2C intra-EU distance sales turnover exceeds €10,000 in a calendar year (single global threshold, Article 259 D of the French Tax Code / CGI), you must apply the VAT rate of the customer's country. The OSS one-stop shop lets you file a single quarterly return in France. For imports of goods valued at or below €150 from outside the EU, the IOSS (Import One Stop Shop) is the applicable regime. Below the threshold, French VAT applies by default.

The intra-EU distance sales regime rests on Directive 2017/2455/EU (amending the main VAT Directive 2006/112/EC), transposed into French law via Article 259 D of the Code Général des Impôts (CGI). This directive created the single €10,000 threshold, abolished the previous country-by-country thresholds, and generalised the OSS one-stop shop.

Article 14 bis of Directive 2017/2455 introduced the concept of the "facilitating" marketplace: a platform that facilitates certain sales is deemed to have purchased the goods itself from the third-party seller and resold them to the end customer. The platform becomes the presumed person liable for VAT in place of the seller.

These texts are not guidance notes. They underpin declarative obligations, penalties, and — since 2022 — automatic exchanges of information between EU tax administrations.

Before going into the detail, here is a map of the applicable regimes according to your operational situation.

The same online business can fall under several columns simultaneously. It is common to manage a French CA3 (for domestic sales), an OSS return (for intra-EU B2C sales above €10,000), and an IOSS return (for low-value imports) in parallel.

The €10,000 threshold is global, cumulated across all Member States, and is assessed on the current calendar year as well as the previous year. It covers both goods sales and B2C digital services.

What tax authorities look for: the DGFiP and its European counterparts now cross-reference billing data, customs declarations, and platform revenue reports. A threshold breach in November that was not followed by a switch to OSS is a quantified discrepancy that triggers retrospective adjustment with interest.

Practical points:

• The threshold is crossed on the euro that takes you above €10,000. You must apply the destination country's VAT rate from that sale onward.
• A sale to a German buyer, one to a Spanish buyer, and ten to Polish buyers: all cumulate.
• If you exceeded €10,000 in the previous year, you fall within OSS territory from 1 January of the current year, without waiting for a new breach.

Our reading: in the files we handle, failure to monitor the cumulative B2C turnover mid-year is one of the most frequent causes of late adjustment. The check should be monthly, not annual.

The OSS Union scheme is accessible via your professional account on impots.gouv.fr. Registration is immediate and takes effect from the first day of the quarter following the application (or the first day of the current quarter if the application is submitted before the 10th of the first month of that quarter).

OSS filing calendar:

The OSS return is filed in euros and sets out, by destination Member State, the turnover figure and the VAT collected at the applicable local rate. It does not replace the French CA3 return: domestic transactions continue to be declared on the CA3.

In practice: the OSS return does not allow you to recover input VAT in destination countries. To do so, you would need local VAT registrations. This is precisely one of the advantages of the one-stop shop — it avoids 27 country-by-country registrations — but the trade-off is the loss of input deduction rights in those markets.

The IOSS (Import One Stop Shop) is the applicable regime when you dispatch goods from a third country (China, the United States, the United Kingdom, etc.) directly to a consumer established in the EU, where the intrinsic value of the consignment is at or below €150.

Step-by-step process:

1. You register for IOSS with the tax authority of a Member State of your choice (in France: the DGFiP). You receive a 12-character IOSS number.
2. At the point of sale, you collect VAT at the destination country rate (e.g. 20% for a French buyer, 19% for a German buyer, 25% for a Danish buyer).
3. You file a monthly return by the last day of the month following the month of sale.
4. You pay the VAT in your Member State of identification.
5. Your parcels present the IOSS number at customs: they are cleared without import VAT being collected at delivery.

Cabinet note: The IOSS number must appear on the shipping documents given to the carrier. If it is absent or incorrect, customs collects VAT on delivery from the recipient — on top of the VAT already collected at the point of sale. The customer complains, you issue a refund. This is a scenario we see regularly in high-volume dropshipping files.

Goods excluded from IOSS:

• Consignments with an intrinsic value above €150.
• Excise goods (alcohol, tobacco, energy products).
• Means of transport.

Consider a French SASU (simplified joint-stock company) selling fashion accessories. In 2026:

• Total e-commerce turnover: €180,000.
• Of which sales to French customers: €130,000.
• Of which B2C sales to customers in other Member States: €50,000, spread across 12 countries.
• Goods are stored in France and shipped from France (no imports from outside the EU).

Obligations that apply:

• The €10,000 threshold was exceeded from the start of the year (it had already been exceeded in the previous year). OSS is mandatory.
• The French CA3 continues to cover the €130,000 in domestic sales and input VAT recovery on purchases.
• The OSS return covers the €50,000 in intra-EU sales, broken down by country, with the applicable local VAT rate applied to each.
• VAT collected via OSS (estimated average at 20%): approximately €8,333 remitted quarterly.

What this reveals: VAT collected via OSS cannot be offset against French input VAT. Purchases of supplies or stock invoiced in France continue to generate deductible VAT on the CA3. The two streams do not offset each other between the CA3 and the OSS return.

Article 14 bis of Directive 2017/2455 introduced a significant legal fiction: when a marketplace facilitates certain sales, it is deemed to have purchased the goods itself from the third-party seller and then resold them to the end customer. VAT is therefore owed by the platform, not the seller.

Two situations covered:

1. Sales of goods imported from third countries, value ≤ €150, to EU consumers: the marketplace collects and remits VAT via IOSS.
2. Intra-EU sales by a seller not established in the EU, regardless of value: the marketplace is the presumed taxable person.

What this means for you as a seller:

• You are no longer liable for VAT on these specific sales.
• You must maintain reconciliation records: which sales were handled by the platform, which remain your responsibility.
• If you are established outside the EU and sell through Amazon France to French customers, Amazon is liable — but you must document this division of responsibility in the event of a tax audit.

The underestimated risk: sellers operating across multiple channels simultaneously (marketplace + own website) sometimes mix up the flows. Sales through your own website are not covered by the platform's liability. A tax audit will cross-reference both.

Whether under OSS or IOSS, you are required to maintain detailed records of all transactions covered by these regimes. Those records must be available on request to the tax authority of any Member State.

Minimum record content (Implementing Regulation EU 2021/1080):

• Date and amount of each sale.
• VAT rate and amount applied, by destination country.
• Buyer identity where available.
• Transport or dispatch evidence.
• Customs declaration number for IOSS transactions.
• Refunds and corrections.

Retention period: 10 years from the end of the calendar year of the transaction. This is a non-negotiable legal obligation, distinct from French accounting rules on document retention.

Automatic data exchanges between Member States (the DAC7 Directive, in force for 2023 data transmitted in 2024) allow tax administrations to cross-reference revenues declared on platforms against sellers' OSS/IOSS filings.

Audit focus points:

• Consistency between turnover declared on OSS and the data transmitted by Amazon, Etsy, and Shopify to the DGFiP.
• Existence and completeness of the 10-year record.
• Presence of the IOSS number on customs documents.
• Correct treatment of returns and refunds in declarations.

For an online seller selling primarily in two or three countries (e.g. France, Germany, Belgium), the question sometimes arises: is it better to register locally in those countries to recover input VAT on local purchases, or to remain on OSS for simplicity?

Our analysis: for the large majority of French online sellers whose intra-EU sales represent less than 30% of total turnover, OSS is the most efficient solution. Local registration becomes relevant when you store goods in another Member State (Amazon FBA stock in a German warehouse, for example) — in that case, OSS does not cover sales dispatched from that warehouse.

• €2 per item levy (1 March 2026): a charge separate from VAT applies to imports of goods under €150 from third countries. It is charged in addition to IOSS VAT and directly affects dropshipping unit margins. Verify current status against the legislation in force at the time of reading (à vérifier).
• DAC7 data matching: platforms have been reporting seller revenue data to the DGFiP since 2024. Inconsistencies between platform data and your OSS/IOSS filings are now detectable at EU level.
• IOSS threshold stable at €150: the European Commission had considered removing this threshold. As of the update date of this article, it remains at €150. Any legislative change must be verified against official sources.

For further reading, see our articles on the different VAT rates on an invoice, VAT reverse charge, and mandatory tax filings in 2026.

• Monitor your cumulative B2C intra-EU turnover monthly to anticipate the €10,000 threshold.
• Register for OSS before the start of the quarter following the breach.
• Configure your sales system to apply the destination country's VAT rate from the very first euro above the threshold.
• Obtain an IOSS number if you import goods from outside the EU for consignments ≤ €150, and communicate it systematically to your carrier.
• Set up detailed records from the moment you open OSS or IOSS, and retain them for 10 years.
• Identify sales handled by a facilitating marketplace and exclude them from your own OSS/IOSS filings.
• Verify consistency between your declarations and the data transmitted by platforms under DAC7.

This article is intended to inform. It does not replace a personalised review of your situation, your transaction flows, or the rules in force at the time of reading. EU VAT rules evolve: any threshold, rate, or deadline mentioned should be verified against impots.gouv.fr, bofip.impots.gouv.fr, or your adviser.